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Barclays CEO Staley said to extend hiring freeze into early 2016

Friday, December 11, 2015 - 20:02
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Britain's financial industry will be damaged if the country votes to leave the European Union, and the "Brexit" debate has already cost the UK some foreign investment, according to two of the nation's most senior corporate directors.

[LONDON] Barclays Plc has extended a freeze on hiring new staff until March as new Chief Executive Officer Jes Staley deepens cost cuts to boost profitability at Britain's second-largest lender, according to people with knowledge of the decision.

A previous ban, implemented by Chairman John McFarlane in September until year-end, was due to be reviewed in January, said one of the people, who asked not to be identified because the move isn't public. There are exceptions to the freeze such as some executive positions considered critical to the business, UK branch staff and low-cost positions, according to the person. Joanne Walia, a spokeswoman at Barclays, declined to comment.

Staley, who took charge on Dec 1, is considering whether to cut an additional 20 per cent of staff at the investment bank, the lender's most expensive and least profitable division, people familiar said last week. The heaviest losses will come in Asia and the global cash equities business, which are not considered competitive enough, according to the people, as the company focuses on businesses in the UK and the US.

Staley, 58, a former JPMorgan Chase & Co investment banker, inherited a strategy from his predecessor Antony Jenkins that involved cutting 19,000 jobs across the lender by 2016, including 7,000 at the investment bank. Barclays in October cut its return on equity target, a measure of profitability, to 11 per cent from 12 per cent for 2016 partly because of rising restructuring charges and misconduct fines.

Shares of Barclays have extended their loss to about 11 per cent this year.

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